Editor’s note: This is the testimony from The Hawaii Bar Owners in opposition to SB331, a proposal to increase the state’s minimum wage to $9.25 per hour in two years from $7.25 per hour.
BY BILL COMERFORD – Occasional raises in the minimum wage may at times be necessary. It is important that the legislature take a look at the need to balance wages with the current economy. It can be assumed that the legislature feels that it is necessary to do so now. However we feel that our industry stands on infirm ground. With federal uncertainties and local uncertainties, it is foolish to demand a connected raise over 3 amounts over multiple years.
Can the legislature read the future any better than those in business? What if we enter a huge downturn next year but we must all face price increases to provide for the wage increase? A long term legislated mandate on wage increases is unsound.
Take the responsible action of making a change if necessary. Do not tie the wage increase to the CPI and give up your regulatory ability to manage the wages to the economy. To tie it to the CPI is to give up all control and institute a forever upwardly cycle of rising prices and wages. The legislature meets annually and can decide this matter annually thus meeting the needs of any current economic picture.
To comment upon the adjustment in unemployment funds rates, we believe you have created the most generous fund in the nation. Does any other state offer 75% of wages earned to their unemployed? Does any other state offer a longer collection period for the unemployed? The norm is 60% of wages and for 6 months yet we offer 75% and 7 months.
The Hawaii legislature gave away our funds generously in 2008 when there was more than $550 million dollars in the fund and then chose to be overly generous by raising the percentage rates from 60% to 70% and extended the benefits period to 7 months. In doing so they depleted our fund more rapidly than necessary. They did not control the rate to the economy. Thus the fund was depleted.
There was also no vote to change the rate to 75%, there was a slight of hand bump to 75% in the first relief bill for the unemployment fund when the existing fund rate was at 70% and the bill worded the measure “the fund will REMAIN at 75%”when it was clearly not at that rate. It was at 70%.
We call on you as legislators to be responsible with our funds and with our economy. We must also ask, if you provide a raise in the minimum wage does that not also generate an across the board series of raises in all union jobs including State and City & County jobs? What hidden costs are in this minimum wage bill when you mandate it to follow the CPI? Will we be unable to meet the increase in all wages and benefits across the board including government union jobs?
Consider parts of this bill, make good choices and don’t give up your responsibility to do your jobs annually. Make the wages and unemployment rate match the economy. You have that in your power.
Bill Comerford is a Spokesman for the Hawaii Bar Owners Association.